20 Mei 2010

ANAO Audit of Lightweight Torpedo Replacement Project

20 Mei 2010

MU-90, the RAN's lighweight torpedo (photo : wielingen1991)

John Faulkner, Minister for Defence, and Greg Combet, Minister for Defence Material and Science, today welcomed the release of the Australian National Audit Office (ANAO) report into the Lightweight Torpedo Replacement Project.

“The ANAO report clearly demonstrates that there have been - and remain - significant and serious problems associated with the development and procurement of the Lightweight Torpedo under Project JP 2070,” Senator Faulkner said.

“I frankly acknowledge that the management of this project and capability has simply not been good enough.”

Mr Combet said Defence had accepted the report and all of its recommendations.

“The project has been a complex undertaking and has a long history of project management difficulties and failures,” Mr Combet said.

”It is clear that the project, first approved 12 years ago, should have been better defined, costed and managed.”

Since 2008, the Government has taken the following actions to remediate this project:

Placing the Project on the Government’s new ‘Projects of Concern’ list. This allowed for a significant increase in the level of Government and senior management oversight of the project, and monthly reports of the project being delivered to Government.

Creating the Explosive Ordnance Division within the Defence Materiel Organisation (DMO) in February 2008 to provide a dedicated and increased focus and management of explosive ordnance project and sustainment activities.

Cancelling the air integration of the Lightweight Torpedo in mid 2009 due to ongoing concerns about its successful achievement.

Senator Faulkner said these actions have not been sufficient to fully address the problems with this project.

“Accordingly, I have asked the Secretary, the Chief of the Defence Force and the Chief Executive Officer of the DMO to report to Ministers every two months on the progress of this project. We believe we can get this project back on track, but this will take some time and a lot of hard work,” Senator Faulkner said.

“In order to promote increased transparency of this project I recently wrote to the Auditor General to request that he conduct a follow up review on the Project in twelve to eighteen months time, to provide an external assessment of its progress.”

Mr Combet said the ANAO report demonstrated the critical importance of the Government’s program to reform defence procurement.

“Since coming to power the Government has crafted a comprehensive program of defence procurement reforms which are designed to avoid issues such as those raised in today’s Audit Report,” Mr Combet said.